Category Archives: Economic Analysis

Why The Financial Media Is Wrong About The Rally In Gold

Gold rallied about 2% after the rate increase announcement yesterday. The financial media believes that this was a typical “buy the fact” reaction. They are wrong.

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US Companies Hoarding Overseas 70% of Quantitative Easing

US companies are hording more than $2.5 trillion in cash in overseas accounts. This is about 70% of the quantitative easing between 2008 and 2014.

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Reason For Fed Procrastination

There may be a reason behind Fed’s procrastination and it is not related to economic data but to investor and trader psychology. Actually, the Fed may be modulating the discounting of interest rate increases before acting.

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Low Volatility-High Dividend Stocks Is the New Safe Haven

At least this is what it appears many investors think in a low/negative bond yield environment since they are convinced that the Fed will not let the market fall. As a result they ignore developments in one of the riskiest … Continue reading

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Time To End This NonSense

Some click-bait websites and various analysts often repeat the “bad news is good news for the market” meme. This creates the impression that the market likes bad for the economy and people news. This is nonsense.

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Goldbug Tricks in the Era of Cryptocurrencies and Deflation

When the stock market rallies, goldbugs scream loud “financialization of commodities.” When the stock market falls, they scream loud “recession”. These are difficult times for goldbugs and for these memes to scare investors. Precious metals are in trouble in the … Continue reading

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Short-Term Rate Increase Neutralized

On December 16, 2015, when the Fed raised short-term rates, the 10-Year Note yield was at 2.29%. After about a month, the market has neutralized the Fed action and the 10-Year Note yield has fallen by about 25 basis points.

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Value Investors Are Reclaiming The Market

This was the worst first week of the year for U.S. stocks in at least 66 years. And this drop may not be related to interest rates, oil prices or geopolitical instability but to the fact that value investors are … Continue reading

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